These funds are now front-running the biggest upcoming investment trend with something more predictable than inside information, and this is what they’re betting on.
Have you ever wondered how venture capital firms (VCs), private equity, and investment banks always seem ahead of the curve?
And how are they always invested in sectors just before they break out?
It’s as if they’re front-running the biggest upcoming trends with inside information.
Well, it’s because that’s exactly what they have: inside knowledge.
I am not talking about trading on insider information. I am talking about something much more powerful.
Think about it this way.
The US patent office sees almost every breakthrough technology originating from the US before these technologies ever come to market.
In fact, some of these technologies never come to market because the US patent office can seize them to protect national security interests or to prevent the proliferation of technology that could harm the economy.
The government can even impose secrecy orders on patent applications if it believes the technology could pose a threat in the wrong hands or is deemed critical for national security.
This is one of the reasons why the US has such a powerful military: it has access to some of the best technologies.
This is also one of the reasons why the big investment institutions are so successful: they have access to some of the best technologies.
Capital Allocation
Every startup and development-stage company needs money.
Guess who has lots and aren’t afraid to lose it?
That’s right: VCs, funds, and private equity.
As a result, just like the US patent office, these investment institutions are presented with new and emerging technologies before everyone else.
So, when they see companies developing similar technologies for a given sector, they know the next big thing is coming.
In fact, they’ll pour billions into these sectors because they know all it takes is one company to be successful to make their multiples.
This is why they’re so successful.
And what have they been focused on in the last few years?
The Next Big Investment Sector
While everyone has been focused on green energy, robotics, microchips, and even SaaS (software as a service), one sector has dominated: healthcare.
Take a look at this chart:
Even though it has fallen from the spectacular highs of the COVID-19 years, the trend of healthcare investing has continued, so much so that seed valuations (valuations for startups raising their first amount of capital) are soaring more than any other sector.
Take a look:
What does this chart tell us?
That there is a reason why seed valuations for biotechs are soaring.
And we believe it’s because A LOT of new emerging technologies in healthcare are coming.
Especially when it comes to cancer.
The Rise of Cancer
In a significant global health trend, the number of individuals under the age of 50 diagnosed with cancer has surged by nearly 80% over the past three decades.
Via Global News:
“The study, published…in the journal BMJ Oncology, found that in 2019 new cases of early-onset cancers (people aged 15 to 49 years) were 3.26 million, a 79.1-per cent increase from 1990.
…The researchers found that new cancer cases with the heaviest death toll for young adults were breast, windpipe, lung, bowel and stomach.
… The highest rates of early-onset cancers in 2019 were in North America, Australasia, and Western Europe, the researchers said.
The study also forecasted cancer rates for the coming years, saying that, “the projections indicated that the global number of incidence and deaths of early-onset cancer would increase by 31 per cent and 21 per cent in 2030,” with those in their 40s the most at risk.”
These are staggering numbers because cancer has often been thought of as a disease for the elderly.
And while cancer mortality rates have been slowly dropping, according to the World Health Organization, over 35 million new cancer cases are predicted in 2050 – a 77% increase from the estimated 20 million cases in 2022
It’s no wonder VCs and private equity are pouring billions into healthcare.
But before you go thinking that their investment dollars are all going toward finding a cure, think again.
We’ve heard about thousands of new cancer cure breakthroughs. And we hear of more every year – yet there has been no cure.
Some will argue that Big Pharma will prevent any cure from coming to market to protect its interest in cancer pharmaceuticals – just as the US patent office blocks certain technologies from emerging.
After all, according to Mordor Intelligence, the size of the cancer treatment market is estimated this year to be worth $220.24 billion and is expected to reach $409.68 billion by 2029.
But one thing is certain: to get treatment, you need to be screened and diagnosed first.
In other words, the key lies in diagnostics.
Continued via Global News:
“…Thomas was diagnosed with late-stage three colon cancer a month before turning 33. She believes the stress she had during her 20s contributed to the large tumour that was found growing inside her rectum.
…Receiving a cancer diagnosis at a young age profoundly altered her life, she said, leading her to adopt healthier coping mechanisms for managing stress.
“I was lucky to get it young because if I got it older, I might not have been able to beat it. And so to me, it was like a reset button,” she said.”
There’s no debate: the earlier you detect cancer, the better the outcomes.
Unfortunately, many young adults don’t meet the recommended age for routine screenings.
Via Yale Medicine:
“Because doctors and researchers don’t yet know why early-onset cancers are increasing, they are focusing on efforts to diagnose these cancers early, when they are typically more treatable.
And family history has emerged as a key factor in early diagnosis.
This is partly because young adults don’t always meet the recommended age for routine screenings that are available for some of these cancers. For instance, because colonoscopy screening typically starts at age 45, most cases in adults younger than 45 are not identified until they start noticing signs and symptoms.
But talking to a doctor about a family history of colorectal cancer could prompt a screening referral at a younger age. “If there is a family history of either cancer or polyps, we usually start colonoscopy screening 10 to 15 years before the family member who had it was diagnosed,” says Dr. Kortmansky. “So, if a first-degree relative was diagnosed with cancer at 45, you would start screening at 30.”
Likewise, women who are at average risk for breast cancer may start biennial mammography screening at age 40, according to US Preventive Services Task Force (USPTF) recommendations updated in 2024. But women with a family history of breast cancer are generally advised to start when they are 10 years younger than the first-degree relative (a mother and/or sister) was at their time of diagnosis.”
In other words, insurance rarely covers screening for cancers if you don’t meet the minimum age requirement. Yet, early screening is critical to better outcomes.
The earlier you detect cancer, the better the chances of survival.
For some routine cancer checkups, the cost can be minimal and accessible.
For example, screening for prostate cancer can easily be done via a blood draw with a PSA test which costs anywhere between $20-100.
On the other hand, screening and diagnosing lung cancer (the number one cancer killer in the world) requires putting radiation in your body and using a CT scan.
These scans can cost upwards of $1000 and often require multiple scans as a follow-up. It’s also not easily accessible.
In the US, there are less than 43 of these machines for every million citizens.
In Canada, it’s significantly worse at less than 15 for every million – that’s less than 550 machines for the entire country, and they’re not all used only for lung cancer screening.
But that’s not all.
Most of the current standard-of-care screenings for cancer aren’t very accurate and often can lead to unnecessary follow-up tests or procedures.
But what if there was a test that can significantly improve these numbers, is easily accessible, and most importantly, affordable?
Well, there may be sooner than we think.
A Breathalyzer for Disease?
One private company we’re heavily invested in is developing a platform for detecting diseases with a single breath—like a breathalyzer for disease. The company is currently focused on lung cancer and has multiple peer-reviewed papers after being tested on more than 800 patients across three clinical sites. We believe it could change the entire diagnostic industry.
You can find more information on them by CLICKING HERE.
And while we believe they will forever change the industry, they’re not the only ones.
That’s why some of the biggest VCs – long known for investing in web, crypto, AI, and other trendy startups – are now pouring billions into diagnostics.
Here is just a small list of VCs and funds who have recently invested in diagnostics: Andreessen Horowitz, AV8 Ventures, AME Cloud Ventures, ARK Investments, Allen and Company, Andreessen Horowitz, Anne Wojcicki, ArrowMark Partners, Artis Ventures, Asset Management Ventures, Bain Capital, BrightEdge Ventures, Brown Advisory, Catalio Capital Management, Charles River Ventures, Cormorant Asset Management, DCVC, Data Collective Venture Capital, EcoR1 Capital, Eventide Asset Management LLC, Farallon Capital Management, Fidelity, Foresite Capital, Founders Fund, GV (formerly Google Ventures), Initiate Ventures, Innovation Endeavors, Intermountain Ventures, Janus Henderson Investors, Kaiser Permanente, Menlo Ventures, Northpond Ventures, Perceptive Advisors, Polaris Partners, Pura Vida Investments, RA Capital Management, Ridgeback Capital Management, Rock Springs Capital, Sands Capital, Section 32, Soleus Capital, Spectrum 28, Squarepoint Capital, T. Rowe Price Associates…
The list goes on…and on.
As you can see, these aren’t just healthcare-focused funds.
In other words, if tech VCs and large institutions are pouring money into healthcare, you can bet that healthcare will be the next big boom.
Seek the truth and be prepared,
Carlisle Kane
Disclosure: We are heavily invested in the diagnostic space, specifically in the private company mentioned in this letter.
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